Pittsburgh Business Times
(By Sean M. McGovern)
Babst Calland Shareholder Sean McGovern takes a closer look at Pennsylvania Governor Tom Wolf’s executive order to develop a stronger environmental justice policy and what local business and industry can expect.
Pennsylvania businesses can expect 2022 to become the year of environmental justice, thanks largely to Executive Order 2021-7 issued by Pennsylvania Governor Tom Wolf on October 28.
So said Sean McGovern, a shareholder with Pittsburgh law firm Babst Calland’s environmental practice, who suggested the executive order will, indeed, change Pennsylvania’s approach to environmental justice significantly ahead.
“Certainly, this is a very current development,” McGovern said. “There’s no statute or explicit regulation here in the state. We already have an environmental justice policy, but this new environmental justice order, as well as the Executive Order 14008 from President Biden earlier this year, will further establish the rights and duties under the Environmental Rights Amendment to protect all people in Pennsylvania.”
McGovern shared his insights on environmental justice in Pennsylvania recently with the Pittsburgh Business Times as part of the law firm’s ongoing Business Insights series. Babst Calland is one of the Pittsburgh region’s largest law firms. McGovern is considered one of Babst Calland’s environmental counselors on issues surrounding environmental justice and other matters of environmental law.
Environmental justice defined
So, what is it? The U.S. Environmental Protection Agency defines environmental justice as “the fair treatment and meaningful involvement of all people regardless of race, color, national origin, or income, with respect to the development, implementation, and enforcement of environmental laws, regulations, and policies.”
While the issue has been around for decades, it took center stage earlier this year when President Biden signed an executive order prioritizing for the federal government “environmental justice on a fairly systemic federal level,” McGovern said.
“It set forth a policy that the agencies under the federal government’s purview will make achieving environmental justice as part of their missions,” he continued, “by developing programs, policies, activities to address disproportionately high human health, environmental and climate-related and other cumulative impacts on disadvantaged environmental justice communities.”
Federal and state guidance
A key reason for the order: “To spur economic opportunity for disadvantaged communities,” McGovern said. “We’re seeing quite a bit now in the press regarding [President Biden’s] Build Back Better plan.” Among its provisions: it gives all people the same degree of protection from environmental and health hazards, and it gives all people equal access to the decision-making process to have a healthy environment in which to live, learn, and work.
The Biden administration also has begun to establish the White House Environmental Justice Interagency Council which, McGovern said, not only includes traditional environmental agencies, but also the U.S. Departments of Commerce, Labor, Justice, Health and Human Services, Transportation, and other federal departments and agencies.
President Biden’s actions to prioritize environmental justice includes a directive to set aside 40 percent of federal funding “investments” for the benefit of disadvantaged communities, McGovern said.
Seeking improved environmental justice in Pennsylvania
This is important background information, McGovern said, because Pennsylvania’s governor largely followed the Biden administration in issuing his own executive order for the Commonwealth to foster greater equity for all Pennsylvania citizens when it comes particularly to environmental health and safety.
“A lot of language in the recitals of the executive order almost directly mirror the executive order from President Biden, so clearly, I would say, the support — inspiration — for the executive order was placed here,” he said.
McGovern said the Pennsylvania Department of Environmental Protection is working on a revised environmental justice policy that currently is being reviewed by an environmental justice advisory board, although the “guidance document … is not a statute, law, or regulation, but really a policy for the [Pennsylvania Department of Environmental Protection] to evaluate permit applications.”
He expects a final policy to be completed in 2022.
Expanding disadvantaged populations
Among the proposed policy’s key provisions, he said: an expansion of the definition of what should be considered an “environmental justice area.” That is, 30 percent or greater of a population that is considered minority, or 20 percent or greater of a population living below twice the poverty level as defined by the U.S. Census Bureau, as proposed in the department’s current working draft.
McGovern also said Wolf’s order will include populations where at least 10 percent of the households have limited English language proficiency.
“This is a broadening of the current definition of an environmental justice area,” McGovern said.
An impact on well permits
The executive order also includes what McGovern referred to as an unconventional well permit section that would “require the DEP’s Office of Oil and Gas to collaborate with the Office of Environmental Justice to conduct an annual assessment of anticipated or actual drilling operations.
“This is important,” he continued, “because it effectively moves the environmental justice policy into a retroactive document for permits that have already been issued historically.”
McGovern described the potential impact on the oil and gas industry as significant.
“The working draft is likely going to impact all of the DEP’s permitting operations as it spreads across industries,” McGovern said. “It’s going to require a significant amount of collaboration between the Office of Environmental Justice and these individual bureaus under the DEP, and it will consider, as part of permit applications, in some cases, past permit approvals — further analysis that companies may not have had to consider before.
“Also, there’s going to be a broadening of environmental justice guidelines here in Pennsylvania, to include a variety of new data, including potential health impacts,” he added.
Like its federal counterpart, Wolf’s executive order also creates an Environmental Justice Interagency Council, in addition to an advisory board, McGovern explained. The council will include the Pennsylvania Department of Conservation and Natural Resources, as well as the Commonwealth’s Departments of Education, Agriculture, Health, Transportation, Community and Economic Development, and several cabinet members “at the discretion of the governor to be part of a periodic meeting to discuss environmental justice across agencies.”
In addition to the executive order, McGovern said, other state legislators have proposed bills that would establish as law the Office of Environmental Justice and an Environmental Justice Advisory Board, as well as an Environmental Justice Task Force and regional committees.
“There’s quite a bit going on as of late here in Pennsylvania … that further establishes, along with the environmental justice policy, that there are critical aspects moving forward in Pennsylvania with permitting industrial activities and how those permit applications are going to proceed,” McGovern said.
An environmental counseling role
McGovern said Babst Calland “has a strong, vibrant environmental practice, and we do handle all aspects of permitting, compliance, enforcement litigation, and transactional work. But environmental justice considerations would probably fall in the counseling area, in that prior to applying for a permit for a development or new industrial activity, for example, an applicant should seek knowledgeable counsel regarding impacts of the environmental justice policy, especially if constructing or operating in an environmental justice area.”
Without question, McGovern said, the forthcoming new policy will require businesses to build in extra time to complete the permitting process and, even then, prepare for hurdles, depending on the location of environmental justice areas.
He added: “As the policy proceeds … it becomes more and more critical for businesses and industries in Pennsylvania to be cognizant of the updated policy during the application process.”
More aggressive enforcement anticipated
To support environmental justice policy and principles, local business and industry can expect more aggressive enforcement at both the federal and state levels, including Pennsylvania, where there’s going to be more enforcement that may likely result in more penalties.
Babst Calland will continue to track these developments and their potential impact across various industries. If you have any questions about the environmental justice, please contact Sean McGovern at smcgovern@babstcalland.com.
Business Insights is presented by Babst Calland and the Pittsburgh Business Times. To learn more about Babst Calland and its environmental practice, go to www.babstcalland.com.
PIOGA Press
(By Gary Steinbauer)
On November 2, the U.S. Environmental Protection Agency (EPA) released its highly anticipated proposal to expand existing and create new regulations related to greenhouse gas (in the form of methane) and volatile organic compound (VOC) emissions from the oil and gas sector. The proposed rule is entitled Standards of Performance for New, Reconstructed, and Modified Sources and Emissions Guidelines for Existing Sources: Oil and Natural Gas Sector Climate Review. The proposal, if finalized, will lead to more stringent Clean Air Act (CAA) emission limitations and other work practice requirements related to emissions of methane and VOCs from new and existing sources within the crude oil and natural gas production sector, including producers in Pennsylvania.
Brief overview of the methane proposal
The methane proposal is comprised of three distinct actions proposed under sections 111(b) and (d) of the CAA: (1) proposed amendments to the existing methane and VOC requirements in Subpart OOOOa of the New Source Performance Standards (NSPS) in 40 CFR Part 60; (2) a proposed new NSPS to be included in new Subpart OOOOb, regulating emissions of methane and VOCs from new, modified and reconstructed sources within the oil and gas sector; and (3) nationwide methane emission guidelines (EGs) for existing sources within the oil and gas sector in new Subpart OOOOc.
EPA’s proposed amendments to the current requirements in Subpart OOOOa are primarily in response to Congress’ June 2021 revocation of regulatory amendments made by the EPA during the Trump administration. The new proposed NSPS to be included in Subpart OOOOb would expand the existing requirements in Subpart OOOOa and regulate additional sources of methane and VOC emissions within the oil and gas sector, establishing the “best system of emission reduction” for affected sources that are new, modified, and recon-structed after the effective date. The proposed EGs in new Subpart OOOOc are a set of presumptive methane emission standards that would apply nationwide to various existing sources within the crude oil and natural gas sector. The proposed EGs in new Subpart OOOOc, if finalized, would not apply immediately to affected sources. Rather, the EGs are intended to guide states in the creation of their own plans to implement the EGs, which would be submitted to EPA for review and approval similar to the state implementation plan process created under section 110 of the CAA.
When it released the 577-page methane proposal, EPA did not provide proposed regulatory text for proposed new Subparts OOOOb and OOOOc. Rather, the methane proposal includes EPA’s summary of and justification for the proposed regulations in these new subparts. EPA states that it will issue a supplemental proposal seeking “additional public input” when it releases the proposed regulatory text for Subparts OOOOb and OOOOc.
Key changes in EPA’s methane proposal
The following five key changes in the methane proposal could significantly impact the majority of crude oil and natural gas producers in Pennsylvania.
- Shift from production to overall site-level baseline methane emissions for determining LDAR applicability and monitoring frequency at well sites. In a departure from the existing low-production well site exclusion from LDAR in Subpart OOOOa, 40 CFR § 60.5397a(1), EPA now proposes to abandon using pro-duction volume as a basis for excluding equipment at well sites from LDAR requirements. Instead, EPA proposes to require LDAR for equipment at well sites based on total site-level baseline methane emissions. Well sites with total site-level baseline methane emissions less than 3 tons per year (tpy) would be excluded from LDAR monitoring requirements, provided that these well sites demonstrate that methane emissions do not exceed 3 tpy through an on-site specific survey. Well sites with total site-level baseline methane emissions exceeding 3 tpy would be required to perform quarterly LDAR monitoring, although EPA is co-proposing a semiannual LDAR monitoring frequency for well sites with total site-level baseline methane emissions between 3 and 8 tpy and quarterly LDAR monitoring for well sites with total site-level methane emissions above 8 tpy.
- Significant expansion of storage vessel regulations. As part of the methane proposal, EPA proposes to expand its regulation of oil and gas-related storage vessels under both Subparts OOOOb and OOOOc. Currently, Subpart OOOOa storage vessel regulations are limited to VOC emissions and based on a VOC potential to emit (PTE) of 6 tpy for a single storage vessel. Under Subpart OOOOb, EPA is proposing to include the same 6 tpy PTE applicability threshold, expand it to include methane, and apply it to a single storage vessel or the aggregate potential emissions from a “tank battery,” i.e., a group of storage vessels that are adjacent and receive fluids from the same operation or are manifolded together. As for storage vessels at existing facilities, EPA is proposing to regulate existing tank batteries with potential methane emissions of 20 tpy or more. Combined with EPA’s proposal to narrowly redefine instances where legally and practically enforceable limitations are in place to limit the PTE for a single or group of storage vessels below the 6 tpy applicability threshold, EPA’s proposal is likely to increase the number of regulated storage vessels and require that methane and VOC emissions from newly regulated storage vessels be reduced by 95 percent using a vapor recovery device or combustor.
- First-time requirements for new and existing oil wells with associated gas. For the first time, EPA pro-poses to require that associated gas from oil wells be routed immediately to a sales line. Currently, there are no NSPS requirements that apply to emissions from venting associated gas from oil wells. In situations where gas-producing oil wells do not have access to a sales line, associated gas would need to be used on-site as a fuel source, used for another purpose that a purchased fuel or raw material would service, or be routed to a flare or other control device achieving 95 percent reduction of methane and VOC emissions. Under the methane proposal, any new or existing oil well producing associated gas would be regulated, regardless of production volumes.
- Zeroing out emissions from new and existing pneumatic controllers. Currently, under Subpart OOOOa, affected pneumatic controllers located anywhere except for onshore natural gas processing plants are allowed to have a bleed rate of 6 standard cubic feet per hour. 40 CFR § 60.5390a(c). Furthermore, intermittent vent natural gas-driven pneumatic controllers are not regulated under Subpart OOOOa, regardless of their location. Under Subpart OOOOb, EPA proposes to regulate single natural gas-driven continuous and intermittent bleed pneumatic controllers regardless of location. All these affected pneumatic controllers would be required to meet a new zero emission rate for VOCs and methane. Lastly, EPA proposes to remove an exemption in Subpart OOOOa that applies to affected pneumatic controllers with a bleed rate greater than the applicable standard based on functional needs, including response time, safety and positive actuation, so long as such pneumatic controllers are tagged with the month and year of installation. § 60.5390a(a).
- Zeroing out or controlling emissions from liquids unloading. Described as an “episodic high-emitting source,” EPA proposes to regulate methane and VOC emissions from liquids unloading. More specifically, each liquids unloading event at an existing affected well site would be considered a modification triggering the requirements in proposed Subpart OOOOb, eliminating the need to regulate liquids unloading at existing well sites under proposed Subpart OOOOc. EPA is proposing to require liquids unloading operations be performed with zero methane or VOC emissions. Where it is not safe to perform liquids unloading operations with zero emissions, EPA proposes to require best management practices to minimize methane and VOC emissions.
The methane proposal is expected to be published in the Federal Register on November 15, starting a 60-day public comment period. In addition to the five key changes noted above, EPA is specifically requesting comments on whether to add requirements related to: (1) abandoned and plugged wells, tank trunk loading operations and pipeline “pigging” operations; and (2) improving performance and minimizing malfunctions at flares.
Babst Calland is tracking the methane proposal closely, particularly as it affects Pennsylvania oil and natural gas producers. If you have any questions or would like addi-tional information, please contact Gary Steinbauer at 412-394-6590 or gsteinbauer@babstcalland.com, Gina Falaschi at 202-853-3483 or gfalaschi@babstcalland.com, or Christina Puhnaty at 412-394-6514 or cpuhnaty@babst-calland.com.
For the full article, click here.
Reprinted with permission from the November 2021 issue of The PIOGA Press. All rights reserved.
The Legal Intelligencer
(By Stephen Antonelli)
On September 9, 2021, President Biden announced his administration’s Path out of the Pandemic action plan, a six-pronged national strategy aimed to combat COVID-19 while keeping schools and workplaces open and safe. One prong of the plan involves vaccinating those who are not yet vaccinated. To achieve this goal, the president took actions that have since been on the minds of most employers and human resources professionals: he issued an Executive Order requiring contractors who do business with the federal government to mandate vaccinations for their employees; he directed the Occupational Safety and Health Administration (OSHA) to develop a rule requiring employers with 100 or more employees to ensure that their employees are either fully vaccinated or tested weekly; and he ordered the Centers for Medicare & Medicaid Services (CMS) to require vaccinations for most healthcare workers.
As of this writing in early November, the Safer Federal Workforce Task Force has released detailed guidance related to the federal contractor order, but OSHA has not yet released an Emergency Temporary Standard (ETS) to implement the mandate for large employers, and CMS has not yet issued an interim final rule related to healthcare workers. As a result, employers across the country are waiting for important guidance and details about how vaccine mandates will impact their employees. Complicating matters further, at least 12 states have commenced litigation against the Biden administration in at least three different federal district courts (Arizona, Missouri, and Florida) over the federal contractor rule, and several states (Texas, Florida, Arizona, and Alabama) have issued executive orders of their own opposing vaccine mandates.
In short, employers could use some clarity on the topic of implementing vaccine mandates.
One agency that has continually provided timely and detailed guidance throughout the pandemic is the Equal Employment Opportunity Commission (EEOC). On October 25, 2021, it provided the most recent of many updates to its Technical Assistance document, a practical question-and-answer format resource that is organized by category. The most recent update primarily addressed the topic of employees’ religious objections to vaccine mandates, by guiding employers through hypothetical situations that many employers have actually faced since the announcement of mandatory vaccination programs. A summary of the latest guidance is below.
- Although employees must tell their employer if they are requesting an exception to a COVID-19 vaccination requirement because of a sincerely held religious belief, practice, or observance, they are not required to use any “magic words,” such as “religious accommodation.” Instead, they must only notify their employer that the requirement conflicts with their religious beliefs, practices, or observances.
- While employers have the right to seek additional information concerning a request for an exception based on an employee’s religious beliefs, employers should generally assume that the request is based on sincerely held religious beliefs, absent an objective basis to question either the religious nature or the sincerity of the stated or professed belief.
- Title VII of the Civil Right Act uses an expansive definition of the term “religion” that protects nontraditional religious beliefs that may be unfamiliar to employers. Employers should therefore not assume that an employee’s request is insincere or invalid because it is based on unfamiliar religious beliefs.
- On the other hand, Title VII does not protect social, political, or economic views, or personal preferences. Such objections to vaccine mandates do not qualify as “religious beliefs” under Title VII.
- Courts are likely to resolve disputes over the sincerity of an employee’s stated religious belief in favor of the employee, because these disputes are largely matters of “individual credibility” that are not easily undermined unless the employee has acted in a manner inconsistent with the stated belief, or the timing of the request is suspicious because, for instance, it follows an unsuccessful request for an exception for a secular reason, or the employer has objective evidence demonstrating that the accommodation is not religious in nature.
- Employers should not assume that a stated belief is insincere because it does not align with commonly followed or known tenets of the employee’s religion, or because the employee’s belief, practice, or observance is relatively new. An employee’s religious beliefs do not have to be shared by an organized religion to be sincerely held.
- While employers should consider all potential reasonable accommodations, including telework and reassignment, in some circumstances, it not may be possible to accommodate those seeking reasonable accommodations for their religious beliefs, practices, or observances without imposing an undue hardship on the employer.
- Employers that demonstrate that a requested accommodation will be an “undue hardship” are not required to accommodate an employee’s request for a religious accommodation.
- Courts have held that requiring an employer to bear more than a “de minimis” cost to accommodate an employee’s religious belief can constitute an undue hardship. Employers should consider monetary costs as well as the burden on conducting business, including the risk of spreading COVID-19 to other employees or to the public.
- When assessing whether a request for an accommodation will cause an undue hardship, employers should consider the unique facts of each situation and determine the cost or level of disruption of each potential accommodation.
- If an employer grants a religious accommodation to some employees, it does not automatically have to grant religious accommodations to all employees who request one. Employers should assess the specific factual context of each individual request.
- When assessing whether an accommodation would impair workplace safety, an employer may consider a number of factors including the type of workplace, the nature of the employee’s duties, the number of employees who are fully vaccinated, the number of people who physically enter the workplace, and the number of employees who will in fact need a particular accommodation.
- Employers are not required to provide employees with the religious accommodation of the employee’s choosing. If there is more than one reasonable accommodation that is available, the employer is not obligated to provide the reasonable accommodation preferred by the employee.
- After granting a religious accommodation, an employer may reconsider it as circumstances change. An employer may therefore discontinue a previously granted accommodation if it begins to pose an undue hardship on the employer’s operations. Before discontinuing the accommodation unilaterally, employers should discuss the proposed change or revocation with the impacted employee. The employer should also consider whether there are any other accommodations that would not impose an undue hardship.
At a time when employers and human resources professionals have just as many questions as they have answers, the EEOC’s updated Technical Assistance document has provided much needed clarity, most recently on the topic of religious objections to vaccine mandates.
For the full article, click here.
Reprinted with permission from the November 11, 2021 edition of The Legal Intelligencer© 2021 ALM Media Properties, LLC. All rights reserved.
Charleston Gazette-Mail
(By Moore Capito)
Small-business owners have many roles to fill–from managing payrolls and marketing to customer service. But one area many small-business owners fail to plan for is their company’s cybersecurity.
According to a recent Small Business Administration survey, 88% of small-business owners feel their business was vulnerable to a cyberattack. Experts warn that small businesses, including those in West Virginia, are under constant attack by cybercriminals, be it from local, national or global actors.
We don’t have to dig deep for a local example of this threat. In 2017 Princeton Community Hospital, in Mercer County, was a victim of the Petya attack, costing the health system $27 million.
Yet, many businesses can’t afford professional IT solutions, have limited time to devote to cybersecurity or simply don’t know where to begin.
As a delegate, I am focused on supporting West Virginia small businesses through state and federal grants and providing critical resources and training to entrepreneurs across the state. Small businesses are the backbone of our economy and provide the greatest opportunity for job growth in our state. We need to do everything we can to encourage and support them. West Virginians are hard-working, dedicated people–they just need the right tools to succeed.
This is where programs like the one hosted by the National Cybersecurity Center come in. The National Cybersecurity Center is a nonprofit organization established to promote cyber innovation and awareness, and offers training for the public and private sector alike. I have the privilege of taking part in a key public education effort, Cybersecurity for State Leaders, which is training leaders in all 50 states on best practices in cybersecurity.
Best practices for maintaining good cyber hygiene apply equally to the government and to business across West Virginia. Individuals must stay on top of their own cybersecurity hygiene, personally and professionally, and continuously stay ahead of emerging threats by completing simple tasks, such as updating your software.
The NCC initiative has taken bold steps to integrate, in their outreach and curriculum, with guests from the private sector, including Robert Herjavec, representative from Google, IBM, Microsoft’s Defending Democracy Program and Meredith Griffanti from FTI Consulting.
From the public sector, participants have included Georgia Gov. Brian Kemp, Mississippi Gov. Tate Reeves, Oregon Gov. Kate Brown, among countless more senators and members of Congress who have supported this initiative.
For West Virginia small businesses, the good news is that this training is now available to the public at no charge.
For more information on Cybersecurity for State Leaders and to find training in your home state, visit https://cyberforstateleaders.org.
Click here to view the full article online in the Charleston Gazette-Mail.
The Legal Intelligencer
By Joe Yeager
On Aug. 10, the U.S. Senate passed President Joe Biden’s Infrastructure Investment and Jobs Act (HR 3684 or Infrastructure Bill) by a vote of 69-30. The $1 trillion Infrastructure Bill received bipartisan support with a proposed $550 billion in new infrastructure spending over the next five years that would be offset by a combination of tax and nontax provisions.
Among other proposals, the Senate bill includes a provision to resurrect a modified version of the long-expired Hazardous Substance Superfund Trust Fund (Superfund) excise tax on chemical manufacturing and imports (Superfund excise taxes). The bill reinstates certain excise taxes to replenish the Superfund, which provides the federal government with resources to respond to environmental threats related to managing hazardous substances.
Congress allowed the excise taxes to expire at the end of 1995, and this absence of funds has forced the Superfund to support cleanup efforts through general disbursements of other tax revenues. Although there have been multiple attempts to reinstate the Superfund excise tax over the course of the last 25 years, none garnered as much bipartisan support.
The new version of the Superfund tax would apply to the production of certain chemicals through Dec. 31, 2031, effective for periods after June 30, 2022. In addition, the Superfund tax will increase the rate of tax per ton on a list of taxable chemicals. Its proponents assert that over the course of 10 years, the new tax is estimated to raise approximately $14.4 billion (or $1.2 billion annually). In support of the Infrastructure Bill, the funds would be specifically aimed at shoring up the Superfund, addressing the overall goals of cleanup and protection of human health and the environment from historical contamination, and bolstering EPA efforts to conduct additional investigations and collect more data on newer sites.
As anticipated, there is opposition by industry (led by the American Chemistry Council) with claims that the reintroduction of the Superfund tax would result in shrinking profit margins and place the United States at a disadvantage in the global chemical industry. The American Chemistry Council condemns the new version of the infrastructure tax because they believe it uniquely focuses on chemical manufacturers and importers (the new Superfund tax differs from the original in that it does not impose tax on oil and petroleum). Historically, the Superfund was funded by three excise taxes applied to oil and petroleum products, chemicals and hazardous substances. The prior funding was intended to seek compensation from those entities deemed responsible for contamination. The proposed Superfund excise taxes are not directed at any particular responsible party, rather the tax will be imposed entirely on those companies that import or produce chemicals, chemical compounds or chemical byproducts. Thus, this new tax could unfairly impact a small subset of the industrial sectors that may have contributed to pollution. According to the opposition, the result of this tax will be the forced closure of more than 40 chemical plants and the loss of thousands of industry-related jobs. In addition, the new Superfund tax would likely increase the cost of a variety of consumer goods, including many of the materials needed for infrastructure and climate improvement.
Assuming the bill passes the House and is signed into law by Biden, a logical next question is how this money be used. The intent of the new tax is to provide monies to EPA in order to boost funding of its Superfund program. It is expected that the monies collected would be applied to contaminated sites without viable responsible parties, known as orphan sites. However, the EPA has also intimated it would like to use some of the new revenue to conduct new investigations about newer sites.
The Senate-passed Infrastructure Bill is currently held up in Congress as talks continue on the passage of the overall act, but there is a strong belief that it will pass because it is viewed as an old tax brought back to life. The Superfund tax is promoted by the Biden administration as a way to advance an increased interest in the environment and as a reliable revenue source to help clean up a backlog of legacy orphan sites. Further, there is bipartisan support to fund the bill due to its potential to offset expenses of the overall Infrastructure Bill without raising new broad-based taxes.
The Senate bill has moved to the House of Representatives for approval and is still pending. It will not become law until it has been approved by the House and signed by Biden.
Although developments continue to unfold, including opposition in Congress, resurrection of the Superfund tax could take some months for the House and Senate to pass a final reconciliation tax bill.
Babst Calland Clements & Zomnir environmental attorneys will continue to track Superfund developments and their implications to the industry in the coming months.
Click here to view the article online in the November issue of the Legal Intelligencer.
Reprinted with permission from the November 4, 2021 edition of The Legal Intelligencer© 2021 ALM Media Properties, LLC. All rights reserved.
Babst Calland has been ranked in the 2022 U.S. News & World Report-Best Lawyers® “Best Law Firms” list nationally in eight practice areas and regionally in 32 practice areas:
- National Tier 2
- Environmental Law
- Land Use & Zoning Law
- Litigation – Environmental
- Oil & Gas Law
- National Tier 3
-
- Bankruptcy and Creditor Debtor Rights / Insolvency and Reorganization Law
- Litigation – Construction
- Mining Law
- Natural Resources Law
- Metropolitan Tier 1
- Pittsburgh
- Bankruptcy and Creditor Debtor Rights / Insolvency and Reorganization Law
- Bet-the-Company Litigation
- Commercial Litigation
- Construction Law
- Corporate Law
- Energy Law
- Environmental Law
- Information Technology Law
- Land Use & Zoning Law
- Litigation – Bankruptcy
- Litigation – Construction
- Litigation – Environmental
- Litigation – Land Use & Zoning
- Municipal Law
- Natural Resources Law
- Water Law
- Charleston-WV
- Commercial Litigation
- Energy Law
- Environmental Law
- Litigation – Environmental
- Oil & Gas Law
- Metropolitan Tier 2
- Pittsburgh, PA
- Charleston-WV
- Mining Law
- Natural Resources Law
- Washington, D.C.
- Metropolitan Tier 3
- Pittsburgh, PA
- Mediation
- Mergers & Acquisitions Law
- Charleston-WV
- Bet-the-Company Litigation
- Litigation – ERISA
- Real Estate Law
- Washington, D.C.
- Environmental Law
- Litigation – Environmental
Firms included in the 2022 “Best Law Firms” list are recognized for professional excellence with persistently impressive ratings from clients and peers. Achieving a tiered ranking signals a unique combination of quality law practice and breadth of legal expertise.
Ranked firms, presented in tiers, are listed on a national and/or metropolitan scale. Receiving a tier designation reflects the high level of respect a firm has earned among other leading lawyers and clients in the same communities and the same practice areas for their abilities, their professionalism and their integrity.
The 2022 Edition of “Best Law Firms” includes rankings in 75 national practice areas and 127 metropolitan-based practice areas. One “Law Firm of the Year” is named in each of the nationally ranked practice areas.
Click here to view the full ranking on U.S. News U.S. News & World Report-Best Lawyers® “Best Law Firms” list.
GO-WV News
By Christopher (Kip) Power
The West Virginia Department of Environmental Protection (WVDEP) is continuing work on rules for permitting of geologic storage of captured CO2 — a necessary (but not sufficient) element in developing a CCS industry.
As discussed in the August GO-WV News, the WVDEP released proposed amendments to its Underground Injection Control (UIC) permitting and related regulations (47 CSR 13) on June 23, 2021 and held a public hearing on the proposed rules on July 23, 2021. Although they include substantial changes to the rules for Class 1 permits (governing hazardous waste injection wells) and Class 2 permits (for enhanced recovery of oil and gas, and disposal of produced water), the rule changes primarily consist of an entirely new section establishing a permitting program for Class 6 wells (those used for injecting carbon dioxide for the purpose of permanent geologic sequestration). Those proposed new Class 6 rules are largely modeled on EPA’s detailed “Class VI” regulations promulgated under the federal Safe Drinking Water Act (40 CFR 146).
Ten organizations (including GO-WV and several environmental/citizen groups) filed comments on the draft amendments, and a few of their representatives spoke at the hearing. By letter dated July 23, 2021, the WVDEP released copies of the written comments it received, along with its responses. There was a total of 10 comments that the WVDEP considered to be meritorious enough to alter the proposed rule language in minor ways, almost all of which consisted of typographical errors (along with the elimination of the use of Roman numerals for identifying the “classes” of permits). The final agency-approved rule proposal was filed with the Legislative Rule-Making Review Committee on July 30, 2021 (incorporating most, but not all, of the edits mentioned in the WVDEP’s July 23 letter).
As expected, most of the comments centered on the proposed Class 6 UIC permit provisions. In this regard, the WVDEP acknowledged that it is seeking to incorporate the Class 6 provisions (new section 13) so that the approved regulations may be included as a part of an “Application for Substantial Program Update” to be filed with the EPA, requesting that WVDEP be granted primacy over the Class 6 UIC well permit program. However, for the most part the WVDEP found that concerns raised by commenters pertaining to this aspect of the regulations either addressed matters within the agency’s discretion under the rules as drafted or exceeded the scope of the UIC program. Those topics deemed to be beyond the scope of the regulations include pore space ownership (or “subsurface trespass”) concerns, enhanced set-back requirements for Class 6 projects located near sensitive areas, “liability for accidents,” and the potential transfer of liability to the State for a completed CO2 sequestration site.
The WVDEP did address two Class 6-focused comments. First, it noted that the Division of Water and Waste Management has tentatively agreed to the terms of a Memorandum of Understanding (MOU) with the West Virginia Geological and Economic Survey (WVGES) to review each application for a Class 6 well permit related to geologic matters, including seismicity. Although the WVDEP believes “the likelihood of induced seismicity is low,” its application for primacy over the Class 6 program will specify that no Class 6 permit application will be considered for approval until after such a WVGES review has been completed. Second, the WVDEP stated that it will await approval of primacy over the Class 6 well permit program, and some actual experience with processing Class 6 well permit applications, before it considers whether to seek a supplemental source of funding for the additional administrative burdens imposed by that program.
In short, the WVDEP’s proposal to amend its UIC regulations to incorporate the Class 6 UIC permit program, which is an important undertaking and will be a key part of application for primacy over that program, is moving along in the rule-making process. However, vesting authority in the WVDEP to issue such permits in West Virginia will almost certainly not be sufficient in and of itself to incentivize the development of carbon dioxide injection and sequestration projects of any significant size.
As other states have done (e.g., North Dakota, Texas), it is reasonable to expect that the West Virginia Legislature will need to enact statutes establishing some fundamental property and liability principles that will govern this new industry before any organization will seek a Class 6 permit to construct a sequestration facility here. Given the number of recent federal legislative proposals that promote the use of some form of carbon capture and sequestration as an important part of the country’s evolving energy policy, and the substantial additional funding that will presumably be available to support such projects, it would appear there is no time to waste in developing those complementary laws.
Click here to view the article online in the November issue of GOWV News.
Renewables Law Blog
(By Bruce Rudoy)
NextEra Energy Inc.’s CEO, Jim Robo, has pushed Congress to extend clean energy tax credits as the company announced record renewables contracts and a major hydrogen project yesterday. Robo said odds are “reasonably high” of an extension if a consensus can be reached on what would be in the reconciliation bill. There is wider support in Congress to expand clean energy tax credits compared to the proposed $150 billion Clean Electricity Performance Program or carbon pricing. Other proposals have included a broad clean energy tax overhaul that some large energy companies say they support. “If something happens there, we feel good about the fact that there will be a long-term extension of the credits,” Robo said, adding that he foresees tax policy support for hydrogen and energy storage investments. “It would be very constructive for us.” As one of the world’s largest renewable energy developers, NextEra has a lot to gain if the Biden administration is successful in financially encouraging wind, solar and other technologies to cut U.S. power sector emissions in half by 2030. President Biden has set the goal of decarbonizing the grid by 2035. “We are increasingly thinking about ourselves as the company that’s going to lead not only the clean energy transformation of the electric grid but really the clean energy transformation of the U.S. economy and the decarbonization of the U.S. economy,” he said. The way Robo sees it, a low-emissions grid is critical to decarbonizing the transportation and industrial sectors. The falling costs of renewable resources combined with utility, corporate and state goals aimed at cutting emissions are driving large-scale projects nationwide. NextEra’s renewable energy unit signed a record 2,160 megawatts of solar, wind and storage projects during the third quarter, the company said during a conference call with Wall Street analysts. This includes 1,240 MW of new wind projects, the largest amount signed during a three-month period in the company’s history, said Rebecca Kujawa, NextEra’s chief financial officer. Even with the future of tax credits in play, NextEra now has more than 18 gigawatts of signed contracts in its development queue, including more than 7,600 MW worth of projects post-2022.
Electric companies nationwide are targeting hydrogen as a new option for emission-free electricity. Kujawa yesterday said NextEra has inked a deal to build a 500 MW wind project designed to power a green hydrogen fuel cell company. “Green” hydrogen is made from water and renewable electricity. That company wants to build a hydrogen electrolyzer nearby and use the wind power to meet up to 100 percent of its load requirements, Kujawa said. The hydrogen produced would be sold to commercial and industrial end-users to replace their current electricity that comes from other forms of hydrogen and fossil fuels, she said. The goal is to further accelerate the decarbonization of the industrial and transportation sectors, she said. Electric companies are eying expanded used of hydrogen during the later part of the 2020s and the next decade, Kujawa said, because it’s likely that long-duration storage will be developed by then. The transportation sector may be able to take advantage of green hydrogen earlier, however, she said. “The big question mark would be whether or not there’s a hydrogen production tax credit ultimately, in the final reconciliation bill,” she said. She said the $3-a-kilogram PTC “really closes the gap” between natural gas-based hydrogen and green hydrogen. That would create more opportunities to replace gas-based hydrogen with green hydrogen and expand renewable energy options. “We’ll know a lot more in January once we see the final package, if there is one,” she said.
E&E News | Article | NextEra announces record renewables, major ‘green’ hydrogen project (politicopro.com)
Tags: decarbonizing, electricity, emission free electricity, Hydrogen, renewable energy
The Legal Intelligencer
(by Anna Jewart)
The requirements of a municipal zoning ordinance are strictly applied, and landowners must comply with the express use and dimensional limitations applicable in the zoning districts in which their properties are located. Landowners wishing to stray from the regulations of that district are usually forced to request relief in the form of a variance, the standards for the granting of which are quite rigorous. However, Article VII of the Pennsylvania Municipalities Planning Code, (MPC), 53 P.S. Sections 10701-10713, authorizes municipalities to enact, amend and repeal provisions within a zoning ordinance fixing standards and conditions for a “planned residential development” (PRD), a form of land development intended to offer an alternative to traditional, cookie-cutter zoning. The opinion of the Commonwealth Court in Gouwens v. Indiana Township Board of Supervisors (Gouwens II), offers an opportunity to revisit the foundations of PRD regulation and to explore the requirements for the tentative approval of a PRD. See Gouwens v. Indiana Township Board of Supervisors, Nos. 544, 992-994 C.D. 2020, 2021 (Pa. Cmwlth. July 8, 2021), publication ordered (Sept. 7, 2021)(Gouwens II), on appeal following remand of Gouwens v. Indiana Township Board of Supervisors, Pa. Cmwlth., No. 1377 C.D. 2018, (filed June 25, 2019), publication ordered (Sept. 7, 2021) (Gouwens I).
A PRD is a larger, integrated residential development that may not meet the use and dimensional standards normally applicable in the underlying zoning district. The idea behind PRD regulations is to create a method of approving large developments which overrides traditional zoning controls and permits the introduction of flexibility into their design. PRD provisions are intended to address a growing demand for housing of all types and design by promoting and encouraging flexibility in land-use regulation, innovation in residential design and layout, and more efficient use of land and public services, while insuring development is carried out under administrative standards and procedures that prevent undue delay. Although PRD regulations represent an opportunity for departure from the terms of the zoning ordinance, they must be based on and interpreted in relation to the statement of community development objectives of that ordinance and must contain certain provisions.
When considering PRD applications, a municipality is required to meet procedural requirements distinct from those imposed upon typical zoning applications. A governing body or planning agency reviewing a planned residential development application must hold a public hearing, and thereafter grant outright or conditional “tentative approval,” or deny the same. The tentative approval of a PRD overrides the zoning ordinance requirements as to that location, and effectively amends the zoning map, pending final approval.
When a PRD has been tentatively approved, the municipality must communicate the decision in writing to the applicant within 60 days following the conclusion of the hearing or 180 days after the date of filing of the application, whichever occurs first. Pursuant to Section 709 of the MPC, 53 P.S. Section 10709, a written decision on a PRD application must include not only conclusions, but also findings of fact and reasons supporting the tentative approval or denial of the application. The MPC expressly requires the decision set forth with particularity in what respect the plan would or would not be in the public interest, including, but not limited to: the extent to which the plan departs from zoning and subdivision regulations otherwise applicable to the property; the purpose, location and amount of common open space proposed; and the manner in which the design of the plan does or does not provide adequate control over vehicular traffic. As outlined in Gouwens II, a municipality’s tentative approval of a PRD may be fatally flawed if it fails to clearly articulate how the plan meets the specific criteria as well as the purpose described in the zoning ordinance.
In Gouwens I, the previous decision of the Commonwealth Court prior to remand, a developer filed an application in Indiana Township, Allegheny County (township), for a PRD consisting of 91 townhouses (plan). In January 2018, the Township Board of Supervisors (board) tentatively approved the plan, despite the fact certain items did not strictly conform to the PRD provisions in the township zoning ordinance (ordinance). In particular, certain details related to the variety of housing, the percentage of the project dedicated to common open space, and the length of a cul-de-sac did not adhere to ordinance requirements. Following the township’s determination, objectors appealed to the trial court, alleging in part that the plan did not meet ordinance requirements and the board’s decision was inadequate under the MPC.
On appeal, the trial court affirmed the tentative approval without taking on additional evidence. objectors again appealed to the Commonwealth Court, which agreed that the Board did not comply with the requirement in Section 709(b) of the MPC that its determination explain how the plan responds, or fails to respond, to specific enumerated ordinance criteria. Consequently, the matter was remanded to the board with directions to issue a new decision with appropriately rendered findings of fact and reasons for the grant of the tentative approval. On remand the board issued a revised decision in support of its grant of tentative approval of the plan. Objectors again appealed to the trial court which again affirmed, and objectors appealed to the Commonwealth Court once more.
On appeal in Gouwens II, the objectors argued that the board’s revised decision still failed to adequately support its determination. The first issue involved whether the plan’s proposal to include three townhouse designs but no other types of housing met the ordinance requirement that a PRD may be approved “if and only if they accomplish” certain purposes, including providing a “variety in the type, design and arrangement of housing units.” The board alleged that the purpose of this requirement was to promote a variety of housing within the township, rather than within the PRD itself, which the court rejected as not reasonable or consistent with the plain language of the ordinance.
The court then turned to whether the Board failed to adequately support its conclusions that the plan met two of the public interest criteria regarding common open space and internal traffic design. As noted above, these criteria are mandated by the MPC and must be adopted in some form within a zoning ordinance’s PRD provisions. Addressing the open space issue first, the court determined that while 60% of the property was proposed to be “open space,” much of it was either to be used for stormwater management, or was located on steep slopes which the developer described as “passive open space,” to be viewed but not used recreationally. The court noted the term “common open space,” as defined in the MPC and ordinance, has been interpreted as a means to ensure the PRD contains mechanisms to provide greater opportunity for recreation and to provide for the conservation and more efficient use of open space ancillary to dwellings. The court rejected the assertions of the developer, adopted by the board, that “passive open space” or portions used for stormwater management constituted “common open space” as defined by the ordinance. It therefore determined the board’s conclusion that the plan met this requirement constituted legal error and an abuse of discretion.
The third issue involved the length of a cul-de-sac proposed to be located within the plan. The ordinance’s PRD requirements stated a PRD proposal must ensure the “physical design of the [PRD] adequately provides for internal traffic circulation and parking …” and requires the “dimensions and construction of … streets … within the PRD will comply with the standards of the township at the time the application is approved.” The township had enacted a “Cul-de-Sac Ordinance” that required cul-de-sacs be no longer than 800 feet including turn-around. In reviewing the plan, the board granted modification of the Cul-de-Sac Ordinance in order to permit a cul-de-sac which exceeded 800 feet. The court found the board had erred by willfully and capriciously disregarding competent and relevant testimony related to the safety issues posed by the length of the cul-de-sac. It further found the board’s decision to grant the modification of the 800-foot limit, and the determination the plan met the adequate traffic circulation requirement, to be legally insufficient and an abuse of discretion.
Because the plan was found to not comply with the requirements of the zoning ordinance, the board’s grant of tentative approval was found to be in error and the trial court’s affirmance of the same was reversed. The Gouwens I and II decisions underscore that while in concept PRDs are intended to encourage flexibility in use and design, that flexibility is constrained by the express requirements of the MPC and underlying zoning ordinance.
For the full article, click here.
Reprinted with permission from the October 21, 2021 edition of The Legal Intelligencer© 2021 ALM Media Properties, LLC. All rights reserved.
The PIOGA Press
(by Kevin J. Garber, Sean M. McGovern and Jean M. Mosites)
On September 14, the Sierra Club, PennFuture, Clean Air Council, Earthworks and other groups submitted two parallel rulemaking petitions to Pennsylvania’s Department of Environmental Protection (DEP) asking the Environmental Quality Board (EQB) to require full-cost bonding for conventional and unconventional oil and gas wells, for both new and existing wells. The petitions do not address or consider the permit surcharges and other funding mechanisms for plugging wells, including the federal infrastructure bill that is expected to provide millions of dollars to plug abandoned wells.
Background
The Pennsylvania General Assembly addressed and increased bonding in 2012. Under Act 13, well owners/operators are required to file a bond for each well they operate or a blanket bond for multiple wells. Currently, the bond amount for conventional wells is $2,500 per well, with the option to post a $25,000 blanket bond for multiple wells. 72. P.S. §1606-E. For unconventional wells, the current bond amount required varies by the total well bore length and the number of wells and is limited under the statute to a maximum of $600,000 for more than 150 wells with a total well bore length of at least 6,000 feet. 58 Pa.C.S. §3225(a)(1)(ii). EQB has statutory authority to adjust these amounts every two years to reflect the projected costs to the Commonwealth of plugging the well.
Proposed changes to bond amounts
The petitioners contend that a lack of full-cost bonding has resulted in the abandonment of thousands of wells and that such wells pollute the environment and adversely affect the health of communities, and allege that the EQB has an obligation to increase bond amounts pursuant to the petition under the Environmental Rights Amendment. Pa. Const. art. I, § 1 27. Petitioners argue that increased bond amounts would encourage operators to plug nonproducing wells or provide funds for the state to plug wells if an operator does not plug them.
The petitioners rely upon the EQB’s authority to adjust a well’s bond “every two years to reflect the projected costs to the Commonwealth of plugging the well” (58 Pa.C.S. § 3225(a)) to propose a dramatic increase in bond amounts, applying the increases retroactively.
Petition for full-cost bonding for conventional wells. The petition for conventional well bonding seeks to amend 25 Pa. Code § 78.302.
The petition requests the bond increase from $2,500 to $38,000 per well and the blanket bond increase from $25,000 to the sum of the applicable individual bond or security amount required for each well. For example, a blanket bond for 10 wells at $38,000 per well would total $380,000. The petitioners contend that the proposed bond amount is supported by an expert analysis of average well plugging costs from 1989 to 2020. The expert report concludes that the bond should be raised to $25,000 and $70,000, for conventional and unconventional wells respectively. The petition notes, however, that $38,000 is in line with DEP’s estimate of $33,000 for its average historical cost of plugging abandoned/ orphaned conventional wells.
The amendment requested would apply to new as well as existing wells drilled after April 17, 1985. The amendment also would require DEP to report to EQB every two years (four years, if two is not feasible) whether EQB should adjust the bond amount.
Petition for full-cost bonding for unconventional wells. The petition asks EQB to adopt a new regulation for unconventional wells in 25 Pa. Code Chapter 78, which would mirror an amended regulation for conventional wells, even though 25 Pa. Code § 78a.302 already exists and would contradict the proposed new regulation.
The petitioners want EQB to increase the bond from the current range, which starts at $4,000 per well, to $83,000 per unconventional well. Blanket bonds would equal the sum of the applicable individual bond or security amount required for each well. For example, a blanket bond for 10 wells at $83,000 per well would total $830,000. The petitioners rely on substantially the same analysis and rationale used in their petition for conventional wells to support the increased bond amounts.
Like the petition for conventional wells, the regulation would apply to new and existing unconventional wells drilled after April 17, 1985, and would require DEP to report to EQB every two years (four years, if two is not feasible) whether EQB should adjust bond amounts.
What happens next?
Under EQB’s Petition Policy (25 Pa. Code Chapter 23), DEP must determine whether the petitions are complete and if they request an action that EQB can take without conflicting with federal law. If DEP determines the petitions meet the above conditions, it will inform EQB of the petition and the nature of the request. The petitioners may make a brief oral presentation at the next EQB meeting occurring at least 15 days after the department’s determination, and DEP will make a recommendation whether the EQB should accept the petition.
Babst Calland is tracking these petitions and subsequent actions taken by DEP and the EQB. If you have questions regarding the potential regulatory changes described above, please contact Kevin Garber at 412-394-5404 or kgarber@babstcalland.com; Sean McGovern, 412-394-5439 or smcgovern@babstcalland.com; or Jean Mosites, 412-394-6468 or jmosites@babstcalland.com.
For the full article, click here.
Reprinted with permission from the October 2021 issue of The PIOGA Press. All rights reserved.
Smart Business
(by Sue Ostrowski featuring Peter Schnore)
COVID-19 has had a dramatic impact across the board, creating economic uncertainty and having an adverse effect on commercial property values that continues to this day. In Allegheny County, effects are perhaps most pronounced in the office market, and in particular in Class B downtown Pittsburgh office space, but no commercial property type with indoor space has been immune, says Peter Schnore, shareholder at Babst Calland.
“Tenants’ initial response to COVID was a wait-and-see holding pattern with respect to whether they were going to renew leases or move to new space,” says Schnore. “As a result, many landlords have had to dig deep to keep and attract tenants by offering unprecedented periods of free rent or tenant improvement allowances, creating an adverse impact on net operating income. The unknowns surrounding COVID are still affecting nearly all commercial property types, not just office properties.”
Smart Business spoke with Schnore about how COVID is impacting the value of commercial real estate and why it may be a good idea to review your recent tax assessment.
What is the current situation for owners of commercial real estate?
Future uncertainty while we remain in the throes of COVID is driving up risk of commercial property investment, driving down commercial property values. Landlord concessions — in some cases multiple years of free rent or triple-digit tenant improvement allowances — are increasing operating expenses and reducing short-term income, resulting in an immediate and substantial adverse impact on value. As a result, many properties that house office, retail, restaurants, hospitality and others now have assessments that are higher than the current value of the real estate merits.
COVID-19 has also impacted business owners who own their own space as they question whether they actually need the amount of space they own. If your space has been sitting partially empty for a year and a half now because employees are working remotely, do you really need to hang on to it? That is adding to the glut of available space on the market and driving down value, including the value of owner-occupied space.
Why might your assessment appear low but actually be high?
In Allegheny County, the last reassessment was in 2012 — thus, the assessment on your tax bill represents value from nearly a decade ago. Pennsylvania has no regular reassessment schedule, and it is easy to forget taxpayers have an annual right to challenge assessments. Each year, the state publishes an equalization ratio for counties based on a comparison of the county’s most recent years’ sales data vs. the sold properties’ assessments. In a properly filed appeal, this ratio can be applied to the property’s current fair market value to set the assessment. Because counties are not required to regularly reassess, the financial benefit of a decreased assessment may be enjoyed for many years.
Importantly, for Allegheny County, there has been a sudden and significant drop in this ratio from last year, the most significant drop since the last reassessment. That makes 2022 a particularly good year for owners to evaluate whether an appeal is warranted.
Owners of commercial properties in Allegheny County have until March 31, 2022, to initiate an appeal; for owners of property in the remainder of Pennsylvania, annual appeal deadlines are between Aug. 1 and Oct. 3, 2022, depending on the county.
What is the appeals process?
Start by gathering your income and expenses for the last three years. Work with an attorney to discuss what the income of the property has been and the expected rate of return. Whether an income-producing investment property or an owner-occupied facility, an attorney, often with the assistance of the right appraiser, can evaluate the current value and help determine whether an appeal is warranted.
Although you can’t file an appeal in Allegheny County until Jan. 1, 2022, talk to an attorney now. Getting your information in order allows you to be prepared when the filing period begins. Property taxes are often the most significant operating expense for an income-producing property, so it’s important to evaluate your situation, with the help of an attorney, to make sure you are not paying more than you should be.
For the full article, click here.
For the PDF, click here.
Renewables Law Blog
(By Ashley Krick)
On September 8, 2021, the Department of Energy (DOE) released its Solar Futures Study providing a blueprint for the role of solar energy in decarbonizing the nation’s power sector. The 310-page Study outlines a future in which solar provides 40% of the nation’s electricity supply by 2035 through cost reductions, technological improvement, rapid deployment, and supportive policies. And, with the electrification of buildings and the transportation sector, solar could also power 30% of all building end uses and 14% of transportation end uses by 2050.
The Study identifies several policy initiatives needed to support the deployment of solar at this scale, including decarbonization targets, R&D investments and cost reductions, changes to wholesale electricity market regulation, and transmission development, to name a few. In order to meet the 40% by 2035 goal, the Study estimates that the U.S. must install an average of 30 GW of solar capacity per year between now and 2025 and 60 GW per year from 2025-2030, with a total of 1,000 GW of solar deployed by 2035. If the solar industry sees this level of growth, the Study estimates that the industry could employ up to 1.5 million people by 2035. The Study also highlights the important role that battery storage and demand-side management will play given that solar power varies based on daily and seasonal patterns.
With solar power currently providing approximately 3% of the nation’s electricity supply, the DOE’s 40% goal will be contingent on many factors supporting the industry in the coming years, including cost reductions, supportive policies, and widespread deployment.
Tags: Department of Energy, DOE, renewable, renewable energy, solar, solar energy
The PIOGA Press
(by Lisa Bruderly)
The U.S. Environmental Protection Agency (EPA) and U.S. Army Corps of Engineers announced, on September 3 that they had halted implementation of the current definition of “waters of the United States” (WOTUS) effective immediately and reverted back to the pre-2015 definition until further notice. The switch follows an August 30 order from the U.S. District Court for the District of Arizona, which remanded and vacated the definition of WOTUS promulgated by the Trump administration in 2020 (commonly referred to as the Navigable Waters Protection Rule (NWPR)) in the case of Pascua Yaqui Tribe v. U.S. Environmental Protection Agency. While there was speculation that the court’s vacatur could be narrowly interpreted to apply only to states where the plaintiffs in the case were located (i.e., Arizona, Minnesota, Washington and Wisconsin), EPA and the Corps are applying the change in WOTUS definition nationwide.
Importance of the definition of WOTUS
The definition of WOTUS identifies which waters are federally-regulated under the Clean Water Act (CWA), and therefore determines when a federal permit is required for projects (e.g., pipelines, access roads, well pads) that involve dredging or filling of a waterbody (i.e., a Section 404 permit). The WOTUS definition also affects federal spill reporting and spill prevention planning.
With regard to Section 404 permitting, the more expansive the definition of WOTUS, the more waters that are federally-regulated. The extent of WOTUS impacts resulting from a project determines whether an individual or a general Section 404 permit is required, with the process for obtaining an individual permit typically resulting in more Corps involvement, delay and expense.
Significance of the change in WOTUS definition
When the Trump administration promulgated the NWPR in 2020, environmental groups criticized and challenged the new WOTUS definition, claiming it was too narrow and did not federally regulate enough types of waters. For example, the NWPR did not federally regulate ephemeral streams or other waters based on Justice Anthony Kennedy’s “significant nexus” test, introduced in the seminal Supreme Court opinion Rapanos v. United States and Carabell v. United States.
By vacating the NWPR, WOTUS are again described under a definition promulgated in the late 1980s and interpreted in subsequent EPA/Corps guidance that was issued following the Rapanos and Solid Waste Agency of Northern Cook County (SWANCC) v. United States Supreme Court decisions. This earlier definition and subsequent interpretations are generally considered to be more expansive and inclusive than the NWPR. Subsequently, reverting to this earlier definition is expected to result in more waters being federally regulated.
Biden administration’s plan to revise the WOTUS definition
President Biden has always intended to revise the definition of WOTUS. In his first week in office, he asked EPA and the Corps to consider revising or rescinding the current definition. On June 9, EPA and the Corps announced their intent to revise the WOTUS definition “to better protect our nation’s vital water resources.” The agencies identified a two-step rulemaking process, which would first restore protections in place prior to 2015 with updates to reflect relevant Supreme Court decisions, and a second rulemaking that would continue to “refine and build” on the prior definition. In addition to developments in science, EPA and the Corps identified that the new rulemaking would consider, among other things, the effects of climate change and input received from disadvantaged communities with environ-mental justice concerns.
On the same day, the Department of Justice (DOJ) filed a motion to request remand of the NWPR to EPA and the Corps. DOJ also asked courts to stay judicial challenges to the current WOTUS definition while the Biden administration reconsidered the definition. However, the court in the Pascua Yaqui Tribe case, instead remanded and vacated the NWPR definition. This vacatur prompted the EPA/Corps decision on September 3 to revert to the pre-2015 WOTUS definition.
Anticipated impact and timing
While the WOTUS definition proposed by the Biden administration will certainly be more expansive than the NWPR, it is yet unclear how far the pendulum will swing with the proposed rulemakings. The agencies have expressed their intent to develop a “durable” definition of WOTUS based on input from “diverse perspectives and based on an inclusive foundation.” To start this process, the agencies solicited pre-proposal written recommendations about how to define WOTUS and implement this definition. In addition, the agencies held several public meetings, during which the public could pro-vide verbal recommendations. More public engagement is anticipated, including 10 geographically focused roundtables for stakeholders.
Among other things, the Biden administration’s definition of WOTUS will most likely regulate waters (including ephemeral streams) that are considered to have a “significant nexus” to traditionally navigable waters. This definitional change is expected to require more energy infrastructure projects to obtain federal CWA permitting, thus extending the time and increasing cost of permitting for many projects that impact waters. No timeframe for the new rulemakings has been announced. While EPA’s Spring 2021 Unified Agenda of Regulatory and Deregulatory Actions identified revision of the definition of WOTUS as a “long-term action,” with unspecified dates for the proposed and final actions, it is unclear whether this most recent change in WOTUS definition will change the schedule for proceeding with the proposed rulemakings.
Babst Calland will continue to track developments related to the federal regulation of waters and will provide necessary updates. If you have any questions or would like any additional information, please contact Lisa M. Bruderly at 412-394-6495 or lbruderly@babstcalland.com.
For the full article, click here.
Reprinted with permission from the September 2021 issue of The PIOGA Press. All rights reserved.
RMMLF Water Law Newsletter
(By Lisa M. Bruderly)
On June 25, 2021, the U.S. Army Corps of Engineers (Corps) released the finalized Pennsylvania State Programmatic General Permit-6 (PASPGP-6). See Corps, Special Pub. Notice No. SPN-21-28 (June 25, 2021). Going into effect on July 1, 2021, the permit will expire in five years, on June 30, 2026. Under section 404 of the Clean Water Act, 33 U.S.C. § 1344, and section 10 of the River and Harbor Act of 1899, 33 U.S.C. § 403, PASPGP-6 authorizes work in “waters of the United States” (WOTUS) within Pennsylvania that causes no more than minimal adverse environmental effects. State authorization under the Pennsylvania Department of Environmental Protection’s (PADEP) chapter 105 regulations (typically, a general permit or a waiver) is still required for most activities authorized by PASPGP-6.
For projects that meet the threshold criteria, PASPGP-6 typically provides a quicker and less complicated alternative to obtaining an individual section 404 permit. The permit identifies reporting activities, which require Corps review and coordination, as well as non-reporting activities, which can be authorized by PADEP without Corps involvement. Compensatory mitigation, at a minimum one-to-one ratio, will typically be required for impacts to WOTUS that are greater than 0.1 acre and are a reporting activity.
PASPGP-6 updates include new eligibility and reporting guidelines. Key changes from PASPGP-5 to PASPGP-6 include:
- The 1.0 acre eligibility threshold for temporary and/or permanent impacts to WOTUS was changed to an eligibility threshold for permanent loss, both direct and indirect, of 0.5 acre of WOTUS and 1,000 linear feet of jurisdictional stream channel.
- The eligibility threshold for temporary impacts to WOTUS, including jurisdictional wetlands, was changed from 1.0 acre to unlimited acreage, provided the work is determined to result in no more than minimal impact.
- Eligibility thresholds are determined based on the impacts of each “single and complete project,” as determined by the Corps. Reporting thresholds are determined based on the impacts of the overall project, and not the single and complete project.
- The reporting thresholds of 0.10 acre of permanent wetland conversion and 0.5 acre of temporary and/or permanent impacts to WOTUS were replaced with thresholds of 0.25 acre of permanent impacts to WOTUS, 250 linear feet of permanent impacts to juris-dictional stream channel, and 1.0 acre of temporary impacts to WOTUS.
- Certain formerly ineligible section 10 waters in the Corps’ Pittsburgh District are now eligible for the PASPGP. Except for work that qualifies for authorization under PADEP Waivers 10 and 12, any regulated work within these waters is a reporting activity and requires Corps review.
- Language was added stating that all waters and wetlands are assumed to be WOTUS in the absence of an approved jurisdictional determination.
Grandfathering provisions are in place for activities that were permitted (or intended to be permitted) under PASPGP-5. Generally, verified reporting activities under PASPGP-5 that comply with the terms and conditions of PASPGP-6 are authorized by PASPGP-6. In addition, all previously authorized non-reporting activities under PASPGP-5 that meet the terms and conditions of PASPGP-6 are reauthorized without further notice to the Corps. Activities that obtained PASPGP-5 authorization by June 30, 2021, have a valid state authorization, and commenced construction (or had construction work under contract to commence) prior to June 30, 2021, have until June 30, 2022, at the latest, to complete the regulated work under the terms of the PASPGP-5 authorization and PADEP authorization. The Corps has provided additional guidance on grandfathered activities and other aspects of PASPGP-6 on its websites for the applicable districts.
Copyright © 2021, The Foundation for Natural Resources and Energy Law, Westminster, Colorado
Smart Business
(by Sue Ostrowski featuring Kevin Douglass)
You’ve just discovered someone is stealing from your company. Worse yet, what if a high-level person — a partner, an owner, a director or an officer — is involved?
“Particularly if the theft involves a substantial amount of money, an accomplice outside of your business, or if criminal investigatory agencies are involved, you should consult with an attorney about how best to interact with authorities, respond to possible subpoenas, conduct an internal investigation and craft a consistent message to employees and customers,” says Kevin Douglass, a shareholder at Babst Calland.
Of course, every employee with access to company financials poses a risk, and every company should take steps to protect itself.
Smart Business spoke with Douglass about how to keep your business from falling prey to a theft — and what to do if it happens anyway.
How can a company protect its assets?
Employees with the greatest access to the company’s finances are in the best position to take advantage. The easiest way to prevent stealing is to ensure that there are checks and balances built into your company’s financial system, regardless of the trust you have in employees or colleagues responsible for managing that system.
The easiest way to do that is to require that more than one person monitor the company’s cash flow, including approval or review of checks, credit and debit card usage, petty cash and invoicing. If that is not possible, consider an audit every couple of years by an independent accounting firm and provide them with full access to the company’s internal financial records.
An individual may only take small amounts in the beginning, increasing the amount and frequency as they gain confidence. And to cover their tracks, they likely will delete, alter or fabricate financial recordkeeping. If undetected, embezzlement can last years, or even decades, and add up to thousands or millions of dollars. Once someone starts down this path, they rarely stop until they are caught.
Company theft happens more often than you might think. No company wants to publicize the fact that an employee is stealing. Often, once detected, a business may choose to quietly terminate the employee and sweep the situation under the rug to avoid negative attention. But that does not mean that it did not happen.
Once theft is discovered, how should a company proceed in the immediate aftermath?
First, you must be certain the person has actually stolen from the business. As quickly as possible, perform an internal investigation and, depending on the complexity and scope, consider hiring an independent investigator or accountant to ensure your investigation is credible and comprehensive.
You also need to take steps to prevent further harm to your business, including likely termination of the employee, denying the offender access to the company’s accounts and finances, as well as other company records and property, including laptops and company phones. An employee under suspicion may intentionally delete computer files and/or alter records, so decisive and immediate action is necessary. If the individual has signature authority on a bank account, you need to remove that authority or consider closing the account.
After a theft is discovered, consider whether and how to communicate with other employees, customers and the public. Can you keep this quiet? Should you keep it quiet? What is the right messaging?
In addition, you must decide whether to report the theft and seek recovery of the stolen funds. Is a customer a victim via fabricated invoices or other means? If yes, consider your obligations with counsel given the company’s unwitting role in the theft.
How can an attorney help you navigate the crisis?
It is critical to receive sound advice as quickly as possible when confronted with a theft of company assets involving an owner or employee. Counsel can guide you through this stressful process, ensuring proper communication and messaging with governmental authorities, employees and customers, as well coordinating the internal investigation. In addition, counsel can help navigate the complex contractual issues that may arise in order to sever ties with an offending owner.
For the full article, click here.
For the PDF, click here.